* LSE committed to completing Refinitiv deal
* Discussions with EU regulators ongoing despite coronavirus
* First quarter income boosted by market volatility
(Adds detail, background)
By Huw Jones
LONDON, April 21 (Reuters) - The London Stock Exchange said
on Tuesday it was committed to completing its $27 billion
takeover of data company Refinitiv in the second half of the
year, with no plans to revise its savings targets for the deal
as a deep recession beckons.
"We still have a lot of confidence in the transaction, in
the strategic rationale of the transaction," LSE Chief Executive
David Schwimmer told analysts.
The coronavirus pandemic is sending economies rapidly into
deep recession, forcing many companies to furlough millions of
staff and raise funds to stay afloat.
Analysts asked Schwimmer whether the deteriorating economy
was changing his view of the Refinitiv deal and he said it was
"a little bit early to be speculating" on synergies from the
deal.
The recurring nature of Refinitiv's income was an
"attractive element" that offers resilience during such economic
conditions, Schwimmer said.
"I don't think that at this point we have any plans to
change anything in terms of our target synergies," Schwimmer
said.
"We think the combined business would be able to continue to
perform well through an environment like this and would be able
to handle the leverage."
Refinitiv is 45%-owned by Thomson Reuters, which owns
Reuters News.
COMPETITION SCRUTINY
European Union competition regulators had requested a delay
on all filings from merger parties due to its staff having to
work from home during the coronavirus pandemic.
"We continue to engage constructively with the case team at
the European Commission. They have been in communication with us
and we continue to answer questions. We are continuing to make
progress," Schwimmer said.
Schwimmer said he was still committed to completing the deal
in the second half of this year.
LSE Chief Financial Officer David Warren said the "bridge"
put together with banks to finance the deal could be extended
until 2021 if need be and contained "significant headroom".
There is a "drop dead" May 2021 deadline for the transaction
that can be extended by mutual agreement of both parties.
The LSE said it was too early to say what the impact of the
pandemic would be on its own operations but that it has over 1
billion pounds in free cash and cash lines to maintain
continuity of business.
"Our business continues to generate cash and bring our own
leverage down," Schwimmer said.
The LSE intends to pay its final dividend for the 2019
financial year, subject to approval from shareholders at the
annual meeting later on Tuesday morning, it said.
The exchange posted first quarter results on Tuesday that
were lifted by higher trading and clearing volumes during recent
bouts of extreme market volatility.
First quarter total income rose 13% year-on-year to 615
million pounds ($763.2 million) as the exchange benefited from
higher trading in shares, and higher clearing activity.
Markets across the world faced bouts of extreme volatility
and record volumes during March as investors priced in
recessions following national lockdowns that have shut down
swathes of economic activity.
"There will be lots of consideration about how the ecosystem
worked in the period of heightened volatility. I am not clear
that we are through the worst of this yet," Schwimmer said.
"We can say with confidence that so far our systems have
worked very well," Schwimmer said.
($1 = 0.8058 pounds)
(Reporting by Huw Jones; editing by Dhara Ranasinghe)